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SAIL Consortium May Finalise Pact with Afghan Govt by July-End

Thursday, June 28, 2012
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New Delhi: The SAIL-led consortium may sign the final pact with Afghanistan by July-end to develop a steel plant, a thermal power plant and necessary infrastructure with total investments of over $10 billion, Afghanistan's mines minister Wahidullah Shahrani said. "Right now, we are in the final stage of contract negotiation. Hopefully...By the end of July, we will be signing the agreement," Shahrani told reporters at the Delhi Investment Summit on Afghanistan organised by CII. He said the agreement would be signed in Kabul and the total investment by the Indian consortium would be over $10 billion. The Afghan Iron & Steel Consortium had emerged as the preferred bidder for mining exploration rights at three iron ore mines at Hajigak, having an estimated reserve of 1.7 billion tonnes. SAIL has the maximum of 20% equity stake in it, while NMDC and RINL hold 18% each. Among private players, JSW and JSPL hold 16% each, while JSW Ispat and Monnet Ispat & Energy hold 8% and 4% stake, respectively. He said Afghanistan will ensure the supply of coking coal, an important raw material for steel making. The Indian consortium had placed the raw material security as a pre- condition for setting up the steel plant. "Everything has been included in the negotiation. Any raw material that will be needed for making steel including coking coal would be given to them, Shahrani said. SAIL Chairman C S Verma had earlier said the consortium proposes to set up of a 6.12 million tonnes per annum (mtpa) steel plant in Afghanistan in two phases of 3.06 MT each, subject to Afghanistan government making available linkages for coking coal and limestone in requisite volumes. There is also plan to build a 800 MW power plant in two phases of 400 MW each to cater to the operations of the mine and steel plant. As part of building necessary internal infrastructural support, the consortium plans to build 200 kms each of rail, road and transmission line network for the mine and steel project. "The total investment by AFISCO on all of the above is estimated to be $10. 8 billion in phases, subject to negotiations," Verma had said.
Source: PTI
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